Key Insights
- Consumer Inflation Expectations decreased from 3.4% in November to 3% in December.
- Longer-term inflation expectations have also moved lower.
- The significant decline in inflation expectations shows that Fed is successful in its fight against inflation.
On January 8, 2024, traders had a chance to take a look at Consumer Inflation Expectations for December.
The report indicated that Consumer Inflation Expectations declined from 3.4% in November to 3% in December, compared to analyst forecast of 3.3%. As a result, Consumer Inflation Expectations reached the lowest level since January 2021.
Importantly, median inflation expectations declined at all horizons. Three-year-ahead inflation expectations decreased from 3.0% to 2.6%, while five-year-ahead expectations declined from 2.7% to 2.5%.
Declining Consumer…
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